PT Telkom posted a better-than-expected 82% rise in quarterly net profit on Tuesday (31/10/06) on strong performance by its mobile unit, which is seen driving growth for the rest of the year, Reuters reported.

Telkom, with a market capitalization of about $18 billion, booked a net profit of Rp3.4 trillion ($373.8 million) for the July to September period, compared to Rp1.87 trillion in the year-earlier period. The company saw its operating profit soar by nearly 41% from a year ago to Rp6.37 trillion, improving its operating margins to 48.3% from 42% over that period.

Its revenue climbed by about 23% to Rp13.2 trillion in the third quarter Ė about 40% of which came from its mobile phone business, PT Telkomsel, which saw its total number of mobile phone subscribers rise 38% to 32.47 million as of September from the year-ago period.

Tjandra Lienandjaja, a Jakarta-based analyst at BNP Paribas Peregrine, said the mobile phone business and interconnection revenue were the key reasons for the company's performance. "I expect the company to have good fourth-quarter results due to the festive season, which had increased mobile phone usage," he said. "I think in the fourth quarter they could post around Rp3 trillion in net profit."

Lienandjaja said the company might be able to beat its full-year net profit forecast of Rp10.3 trillion if it maintains the same performance over the final three months of the year.

Meanwhile, Telkom president director Arwin Rasyid said on Wednesday (1/11/06) the company had agreed to buy Rp722 billion ($79.27 million) worth of telecommunication equipment from two Chinese firms to increase its capacity.

Huawei Technologies and ZTE Corp won tenders to boost the firm's fixed-wireless telecommunication network by 9.7 million lines, Rasyid said, adding that the project would be completed by 2010 and would increase its capacity in Jakarta, West Java and Kalimantan.